President Donald Trump on Sunday suggested via Twitter that American automaker Ford could begin making its Focus model in the US, and therefore circumvent his tariffs. The Mac mini desktop computer, Apple Pencil stylus accessory for iPads, various chargers and adapters and tooling equipment used to manufacturer and design some products in the US will also be affected, the Cupertino, California-based company told the Office of US Trade Representative in a letter dated 5 September.
Trump's threatened tariffs cover a total of $517 billion in Chinese goods, which would exceed last year's goods imports of $505 billion from China. Start building new plants now.
"The conclusion was for the iPhone (not now impacted by Tariffs) moving production (100% of final assembly) to the USA would need 20% price increases to offset the incremental labor costs", analyst Wamsi Mohan wrote.
Trump tweeted on September 8 that Apple should build new manufacturing plants in the USA to avoid tariffs on Chinese imports that the United States government is planning to introduce. "Exciting!" Trump said in the tweet.
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Adds Trump: "We're going to take a look at what he had, what he gave, what he's talking about also where he is right now". The US president told a rally at Billings, Montana, on Thursday, that the article was "a disgusting thing".
Apple's letter says, "Our concern with these tariffs is that the USA will be hardest hit, and that will result in lower United States growth and competitiveness and higher prices for U.S. consumers".
The company said the tariffs would "show up as a tax on United States consumers" and "increase the cost of Apple products that our customers have come to rely on in their daily lives".
With Ford joining Apple in criticizing President Trump's tariffs, the pressure on the administration to back down and de-escalate the trade war is perhaps greater than ever.
Apple has indicated that President Donald Trump's proposed decision to impose 25 per cent more tariffs on products from China could result in prices of some devices from the company going up. It asked the government to come up with other measures to bolster the economy. It makes many of its products for the USA market in China, and it also sells gadgets including the iPhone in China, making them a potential target for Chinese retaliation against the Trump tariffs.